MARGINAL UTILITY | TOTAL UTILITY |
1. Meaning: - Marginal utility is the additional utility derived from consuming additional unit of consumption. 2. Formula: - MUn = TUn –TUn-1. 3. Relationship: - · Marginal utility continuously diminishes. · When Marginal utility becomes Zero · When Marginal utility becomes negative. | Total utility is the sum total of utilities derived from the consumption of all units in a given stock of a commodity. TU = Σ MU · Whereas, total utility initially increases but at a diminishing rate · Total utility is the maximum. · Total utility starts diminishing. |
MARGINAL UTILITY TOTAL UTILITY
